Brunswick Corporation posted revenue growth of $160 million in 2025, the company’s first top-line increase in three years, whilst absorbing $75 million in net tariff costs and generating $442 million free cash flow.
The recovery follows 2024’s $1.16 billion revenue collapse that triggered 2,000 layoffs at Mercury Marine and a 69 per cent earnings decline.
Brunswick delivered net sales of $5.36 billion in 2025, up two per cent year-over-year. Fourth-quarter results showed accelerating momentum with consolidated sales rising 15.5 per cent to $1.33 billion and earnings climbing 41 per cent versus the prior year.
Mercury Gains Share Whilst Industry Contracts
Mercury Marine’s propulsion segment posted fourth-quarter sales of $557 million, up 23 per cent year-over-year. The segment delivered double-digit increases across all business lines including outboards, sterndrives, and controls.
The company ended 2025 with approximately 47 per cent United States retail outboard market share, adding 70 basis points in the second half alone. Wholesale share momentum accelerated sharply, with more than 400 basis points of gain in the quarter and roughly 900 basis points in December.
The gains came against a contracting market. United States marine retail units fell approximately nine per cent in 2025. Brunswick’s global retail unit sales declined only five per cent, demonstrating significant outperformance.
US Outboard Market Share
Basis Points (Dec Wholesale)
Q4 Propulsion Revenue
Industry Retail Decline
January 2026 Shows Double-Digit Retail Growth
Management reported retail trends in January 2026 showed double-digit growth year-over-year, signalling early momentum as the industry enters the spring selling season.
The improvement suggests consumer demand is stabilising after two years of declines, though management cautioned that macroeconomic volatility and interest rates remain variables affecting purchasing decisions.
Cash Generation Funds Debt Reduction
Free cash flow reached $442 million in 2025, up 56 per cent from the prior year. Brunswick deployed the cash into share buybacks totalling $80 million, dividend increases, and debt retirement of approximately $240 million.
The company ended the year with $1.3 billion in liquidity. Since 2023, Brunswick has retired $375 million in debt whilst maintaining shareholder returns.
David Foulkes, Brunswick Corporation chief executive, told investors the recovery reflected operational improvements across all segments:
Each reporting segment generated revenue growth over the prior year quarter. The sales growth reflected strength across all our businesses despite a challenging, albeit improving, macro environment and industry backdrop.
Tariffs Cost $75 Million Despite Mitigation
Brunswick absorbed a net incremental tariff hit of approximately $75 million in 2025, even after mitigating more than half the gross exposure through sourcing changes and pricing actions.
The tariff costs stem from duties imposed on components and materials imported from China and other countries during the 2018-2019 trade policy changes. Mercury Marine manufactures outboard engines at plants in Fond du Lac, Wisconsin, St Cloud, Florida, and Juarez, Mexico, with supply chains spanning multiple countries subject to tariff regimes.
The company expects an additional $35 million to $45 million in net incremental tariff costs in 2026, with much of the burden concentrated in the first quarter. Brunswick continues pursuing mitigation strategies including supplier diversification and manufacturing adjustments, but management acknowledged tariffs are materially diluting earnings power.
Adjusted earnings per share for 2025 reached $3.27, down from the prior year. Management attributed the decline directly to tariff costs and the reinstatement of more than $100 million in variable compensation expense that will be paid out in 2026.
Tariff Impact: Import tariffs cost Brunswick $75 million in 2025 despite mitigation efforts, with another $35-45 million expected in 2026. The company mitigated over half its gross tariff exposure through sourcing changes and pricing actions.
GAAP Results Show Restructuring Costs
Brunswick reported a net loss of $137.3 million on a generally accepted accounting principles basis, equivalent to $(2.06) per diluted share, due to $411.8 million in one-time charges.
The charges comprised $353.1 million in restructuring, impairments, and exit costs primarily related to the 2024 workforce reductions and facility consolidations, plus $58.7 million in purchase accounting amortization. These one-time expenses resulted in a GAAP operating loss of $40.7 million for the full year.
Excluding these charges, adjusted earnings painted a more favourable picture of operational performance.
All Segments Post Growth
Engine parts and accessories posted fourth-quarter sales of $260.7 million, up 15.3 per cent. Brunswick’s boat segment delivered sales of $387.3 million, up 11.2 per cent with adjusted operating margins expanding by approximately 290 basis points.
Navico Group, the marine electronics division, posted sales of $203 million, up four per cent with operating margins expanding by approximately 180 basis points driven by new product introductions and cost discipline.
Recurring revenue businesses, anchored by parts, accessories and aftermarket services, represented around 60 per cent of total earnings for the year. This higher-quality revenue mix offers a buffer against cyclical swings in new boat demand.
Premium Products Drive Margin Expansion
Discounting levels improved by roughly 100 basis points year-over-year across the boat segment, reflecting firmer pricing discipline and a more favourable product mix tilted toward premium offerings.
The company’s premium brand revenue rose 15 per cent at the Fort Lauderdale International Boat Show, whilst Mercury achieved 61 per cent outboard share at the event. Multiple new boat models received awards during the show.
Lean Dealer Inventories Support 2026 Wholesale
Global boat dealer pipelines were reduced by around 2,200 units year-over-year. United States outboard dealer inventories declined approximately 10 per cent, leaving channel inventory levels lean.
Year-end global boat order backlog stood at 79 per cent of the company’s first-quarter wholesale forecast, up 13 percentage points versus 2024. The setup supports stronger wholesale activity as retail stabilises.
2026 Guidance Assumes Modest Market Improvement
Brunswick guided 2026 revenue to $5.6 billion to $5.8 billion, implying modest top-line growth on an assumption of a flat to slightly improving United States retail market.
Adjusted earnings per share is projected at $3.80 to $4.40, a midpoint roughly 25 per cent above 2025. Adjusted operating margins are expected around the mid-seven per cent area.
Free cash flow is anticipated above $350 million with at least 125 per cent conversion. Brunswick plans to retire no less than $160 million of debt in 2026, bringing total debt reduction over 2025-26 to approximately $400 million.
Management cautioned that the outlook assumes no major supply chain disruptions, stable geopolitical conditions beyond known tariff impacts, and normal weather patterns supporting the spring and summer boating seasons. Any deviation from these assumptions could affect results.
First-Quarter Warning: Management projects Q1 2026 adjusted EPS of only $0.35-0.45, pressured by the bulk of incremental tariff costs and front-loaded investments in new product programmes.
Variable Compensation Creates Cash Headwind
The more than $100 million of variable compensation expense accrued for 2025 will be paid out in 2026, creating an additional near-term cash headwind.
Whilst these compensation costs reflect improved business performance and incentivise management, they nonetheless represent real pressure on reported cash flow in the coming year alongside tariff burdens.
Product Pipeline Supports Premium Positioning
Brunswick highlighted a wave of product launches that reinforce the brand’s premium positioning. Notable announcements included the Mercury 808 concept, Sea Ray’s SLX360 showcase, and SIMRAD AutoCaptain earning recognition.
Management noted recognition on a national best companies list, underscoring its focus on innovation, product quality and corporate culture.
The Paradox
Brunswick’s 2025 performance presents a clear contradiction. The company gained significant market share and generated robust cash flow whilst navigating an industry downturn and absorbing substantial tariff costs.
Mercury Marine added 900 basis points of wholesale market share in December alone, demonstrating competitive strength that more than offset broader market weakness.
The 2026 outlook projects meaningful earnings growth despite known headwinds. Whether tariff mitigation strategies and product momentum can sustain this trajectory through a volatile first quarter remains the critical question.
Brunswick’s recovery from 2024’s workforce reductions and revenue collapse shows what operational efficiency and market share gains can achieve. The 2,000 workers laid off that year did not return. The company is growing without them.
Financial data sourced from Brunswick Corporation’s Q4 2025 earnings release dated January 29, 2026, and SEC Form 8-K filing.
John Moore is the editor of Powerboat News, an independent investigative journalism platform recognised by Google News and documented on Grokipedia for comprehensive powerboat racing coverage.
His involvement in powerboat racing began in 1981 when he competed in his first offshore powerboat race. After a career as a Financial Futures broker in the City of London, specialising in UK interest rate markets, he became actively involved in event organisation and powerboat racing journalism.
He served as Event Director for the Cowes–Torquay–Cowes races between 2010 and 2013. In 2016, he launched Powerboat Racing World, a digital platform providing global powerboat racing news and insights. The following year, he co-founded UKOPRA, helping to rejuvenate offshore racing in the United Kingdom. He sold Powerboat Racing World in late 2021 and remained actively involved with UKOPRA until 2025.
In September 2025, he established Powerboat News, returning to independent journalism with a focus on neutral and comprehensive coverage of the sport.
